Russian Railways’ net profit vanishes

Russian Railways (RZD) has come out with its yearly report for 2024. Some of the company’s indicators have not shaped up great, even if a part of that was expected. Notably, net profit shrunk by around 90 per cent.
There was a wide expectation beforehand that RZD’s net profit would be significantly lower in 2024 than in 2023. The rail operator published its results on Friday 7 March, revealing a 88,25 per cent decline in net profit. That means that RZD achieved a net profit of 13,9 billion rubles (145,1 million euros), whereas that number was 118,3 billion (1.235,1 million euros) in 2023. RZD was hoping for 122 billion rubles in net profit.

In other aspects, the company did not do so well either. Freight turnover shrunk from 3,3 trillion tonne-kilometres in 2023 to 3,1 trillion in 2024. However, the company notes that freight turnover in the east was higher than it had ever been. With container traffic also growing to 7,9 million TEU (5,9 per cent increase) and setting a new record, that is not entirely surprising.

RZD’s total revenue, EBITDA and total asset worth all grew compared to 2023. The total revenue grew to 2.834,4 billion rubles (an 8,6 per cent increase). When adjusted for the official rate of inflation at 8,9 per cent however, that revenue constitutes a decline in real terms.

Loading decline

A major component of RZD’s business problems is the continuous decline in loading on its network. February 2025 brought a noteworthy 9,3 per cent drop in loading volume on the Russian network when compared to February 2024. The loading decline is nothing new, with monthly numbers often ranging from minus 4 to minus 6 per cent, but the 9,3 per cent drop was unprecedented.

Russian media rightfully pointed out that leap year 2024 allowed for a bit more freight to be loaded in the month of February. The daily average decline amounted to a slightly less surprising figure at 6 per cent. Nevertheless, when compared to 2023, the decline still sat at 12 per cent.